FDI in Space: Spatial Autoregressive Relationships in Foreign Direct Investment

32 Pages Posted: 15 Dec 2004 Last revised: 23 Nov 2022

See all articles by Bruce A. Blonigen

Bruce A. Blonigen

University of Oregon - Department of Economics; National Bureau of Economic Research (NBER)

Ronald B. Davies

University College Dublin (UCD)

Glen R. Waddell

University of Oregon - Department of Economics; Institute for the Study of Labor (IZA)

Helen Tammela Naughton

University of Montana - Department of Economics

Multiple version iconThere are 2 versions of this paper

Date Written: December 2004

Abstract

Theoretical models of foreign direct investment (FDI) have only recently begun to model the role of third countries, and the empirical FDI literature has almost exclusively examined bilateral FDI data without recognizing the potential interdependence between FDI decisions to alternative host countries. This paper uses spatial econometric techniques to examine the spatial correlation between FDI to alternative (neighboring) regions. The sign of such correlations can provide evidence for or against alternative theories for FDI motivations. Using data on OECD countries from 1980-2000, we find evidence consistent with export platform FDI in Europe.

Suggested Citation

Blonigen, Bruce A. and Davies, Ronald B. and Waddell, Glen R. and Naughton, Helen Tammela, FDI in Space: Spatial Autoregressive Relationships in Foreign Direct Investment (December 2004). NBER Working Paper No. w10939, Available at SSRN: https://ssrn.com/abstract=629581

Bruce A. Blonigen (Contact Author)

University of Oregon - Department of Economics ( email )

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Ronald B. Davies

University College Dublin (UCD) ( email )

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Glen R. Waddell

University of Oregon - Department of Economics ( email )

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Institute for the Study of Labor (IZA) ( email )

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Helen Tammela Naughton

University of Montana - Department of Economics ( email )

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